Annual Report for the 2016/17 fiscal year

• Order backlog, year-end: DKK 2.43 billion
• Revenue: DKK 1.71 billion
• Year-over-year growth of 15% for the third year in a row
• 94% of the revenue is generated outside Denmark
• Earnings before tax: MDKK 120
• Net increase of 150 new employees during the fiscal year

Lystrup, Denmark – With a year-over-year growth of 15% for the third year in a row and the best result to date in the history of the Company, a very satisfied Board of Directors and Executive Management approved the Annual Report 2016/17 for Terma A/S on Friday, 19 May 2017.

Terma's President & CEO Jens Maaløe

With an order backlog at year-end of MDKK 2,431, Terma has a comfortable business base for business developments in the coming years. Increased activities in the international defense, aerospace, and security markets ensured an order intake in 2016/17 of MDKK 1,411.

“In all Business Areas, we have seen a positive development, which has secured Terma the best result in the company's 70-year history. It is the result of a targeted market strategy combined with continued development in key technologies that meet an increased need for investments in reliable security and surveillance solutions. For example, we have experienced a significantly growing interest in Terma’s radar products, for inclusion in a number of defense and non-defense contexts," says Terma’s CEO Jens Maaløe, and continues:

"The revenue to international customers has further increased to 94% of our total revenue. Recent years’ globalization with the establishment of companies and offices in selected markets are an important factor in this development. Our U.S. company plays a crucial role. The U.S. market accounts directly and indirectly for more than 40% of the company's total revenue. This is part of the reason behind our establishment of a development center in Atlanta, Georgia, USA in collaboration with Georgia Institute of Technology in the very near future. The center will partly strengthen our position in the U.S. market, partly fulfill the need for recruitment of highly educated employees, which is crucial for our continued growth and development, "Says Jens Maaløe.

A net increase of 150 employees during the fiscal year resulted in almost 1,350 full-time employees at year-end.

Revenue for the fiscal year was MDKK 1,719 compared to MDKK 1,499 the year before, i.e. a year-over-year growth of 15% - a strong growth for the third year in a row. Earnings before tax increased to MDKK 120 from MDKK 85 the year before, i.e. a year-over-year growth of 40%.

The Danish parliamentary decision in June 2016 to acquire 27 F-35s as Denmark’s future fighter aircraft fulfilled a critical pre-condition for the expansion of the production capacity in the Aerostructures facility in Grenaa, Denmark. In the coming years, the production of aircraft components in carbon fiber and composite increases significantly from approx. 50 aircraft in 2016 to 130+ aircraft in 2019.

“In Grenaa, we currently have one of the most modern and most efficient plants in Europe for the production of aerostructures in advanced materials. Back in 2008/09, we realized the need to start investments in the development of the company, despite the unexplained situation regarding the choice of fighter aircraft. Today, we can see that we made the right decision. However, we will be faced with increased efficiency requirements, and we will also see increased competition for the F-35 tasks, but I am not worried. We have 360 well-educated and highly reliable employees, and in the coming years, we will welcome many new employees at the Grenaa plant," says Jens Maaløe.

The Annual Report covers the period 1 Marts 2016 – 28 February 2017.

The Annual Report and the CSR Report are available here.